Written by Sumit Roy  |

September 25, 2012

Morning Call: Gold ($1772) & Silver Rebound On Bargain Buying, Oil Rises Amid Iran Tensions

Details

Commodities are higher across the board.

Commodities are rebounding from the prior session's declines, as bargain hunters step in to buy. In today's news, the Case-Shiller home price index grew by 1.2 percent year-over-year in July, up from the prior month's 0.59 percent. That's the second-straight month of year-over-year gains, and suggests that the housing market may be turning the corner.

The U.S. Dollar Index was last trading unchanged at 79.52.

• Gold was last trading up by $7.12, or 0.4 percent, to $1771.57, while silver added $0.42, or 1.22 percent, to $34.41.
  
  Platinum advanced $15, or 0.92 percent, to $1636.75 and palladium edged down by $4.75, or 0.74 percent, to $640.
  
  "We still prefer to be buying gold on dips and believe the break higher will eventually come. But the futures market needs to lose some speculative length and the physical market needs to adjust to a higher price-range first," Walter de Wet, analyst at Standard Bank, said.
  Gold steady as stimulus supports outlook
  
  
• Crude oil is moving higher, in line with other commodities. Brent was last trading up by $1.23, or 1.12 percent, to $111.04, while WTI gained $0.92, or 1 percent, to $92.85.
  
  "Iran has been supporting prices today after the hostile rhetoric yesterday and over the weekend," said Andrey Kryuchenkov, analyst at VTB Capital. "U.S. data is supportive in the short term."
  Oil Rises in New York on Report that Iran Fired Missiles
  
  
• Natural gas was last trading up by $0.02, or 1.37 percent, to $2.88/mmbtu. Most analysts expect the EIA to report an injection in the 60 to 80 billion cubic feet range in this Thursday's inventory report.
  Flush natural gas industry eyes exports
  
  
• Grains are slightly higher today, as corn rises by $0.03, or 0.34 percent, to $7.47/bushel, while soybeans adds $0.14, or 0.84 percent, to $16.24 and wheat gains $0.02, or 0.25 percent, to $8.94.
  
  "People look at any dip in prices as an opportunity to buy and for investors it is an opportunity to go long," said Abah Ofon, analyst at Standard Chartered Bank. "I don't see the market treading lower and lower, I think there is some more upside potential as supplies are very tight."
  Soy rebounds from 6-week low; wheat, corn stable
  
  
• Copper was last trading up by $0.03, or 0.8 percent, to $3.78/lb on Comex.
  
  "People feel you have to see a real improvement in data in order to justify this rally so if you don't get that real improvement the bias for copper will be to retrace part of the move," said Credit Suisse metals analyst Ivan Szpakowski. "I don't think the physical demand is there at all right now so you are really trading off the macro data and announcements."
  Copper slightly firmer, China demand prospects uncertain
  
  

What to Watch For:

9:00 a.m. ET: Case-Shiller Home Price Index (July)

10:00 a.m. ET: Consumer Confidence (September)